IFC offer for Bandhan

Calcutta, June 30: The International Finance Corporation (IFC), a member of the World Bank group, is eyeing a long-term strategic partnership with microfinance institution (MFI) Bandhan.

At present, IFC holds close to an 11 per cent equity stake in the city-based company.

IFC is not only looking at disbursing Rs 160 crore as tier-II capital to the MFI but also share its global experience to transforming Bandhan into a bank. Earlier this year, Bandhan won the RBI’s approval to start banking operations.

“We have a strategic relationship with Bandhan, which is a key IFC client. We are looking to help them in their transformation into a bank. We hope to support them financially and share our global experience of similar transformations,” Nilesh Shrivastava, manager, financial institutions portfolio of IFC, told The Telegraph.

Shrivastava said IFC was in talks with the Bandhan management to share knowledge on best practices followed by MFIs (where IFC is a stakeholder) in Mexico and Cambodia to transform into banks.

“We are also looking to provide tier-II capital amounting to Rs 160 crore. This is not pure equity, but it helps to further improve their capital adequacy,” said Shrivastava.

He said the amount would be disbursed within a couple of months.

Bandhan’s chief Chandra Shekhar Ghosh said he expected the disbursement would soon reach the MFI.

“Going forward if the company needs additional equity we will be happy to explore the same,” said Shrivastava.